The common law definition of intra-policy stacking requiring a separate premium attributable to each vehicle in an insurance policy was applicable to sub. (6) (d) as it existed between 2009 and 2011. Bodish v. West Bend Mutual Insurance Co., 2014 WI App 78
, 355 Wis. 2d 392
, 851 N.W.2d 811
As used in sub. (2) (d), 2009 stats., the phrase “legally entitled to recover" means recovery that exceeds what insureds can actually recover from tortfeasors. The phrase does not thwart underinsured motorist coverage for an insured who has not been fully compensated for his or her damages when the amount of damages an insured could actually recover from a tortfeasor is capped by statute. State Farm Mutual Automobile Ins. Co. v. Hunt, 2014 WI App 115
, 358 Wis. 2d 379
, 856 N.W.2d 633
An exclusion of passengers of an insured's vehicle from a policy's underinsured motorist coverage when the insured driver was at fault and was operating a vehicle insured by the policy's liability coverage, although potentially in violation of sub. (6) (b) 2., was enforceable under the savings provision in sub. (5) (e) that “exclusions are effective even if incidentally to their main purpose they exclude persons, uses or coverages that could not be directly excluded under sub. (6) (b).” Pierce v. Mid-Century Insurance Co., 2016 WI App 79
, 372 Wis. 2d 171
, 887 N.W.2d 115
The requirements of sub. (3), the omnibus statute, are imputed to every policy and supersede contrary policy terms, including policy language purporting to limit the insurer's per-accident liability to a fixed amount. Thom v. 1st Auto & Casualty Insurance Co., 2021 WI App 33
, 398 Wis. 2d 273
, 961 N.W.2d 79
The purpose of sub. (3), the omnibus statute, is to make sure that insurance coverage obtained for “a vehicle listed in the policy" also provides coverage for individuals who use it with permission and are responsible for using it. Thus, it is sometimes said that the omnibus statute prohibits insurance companies from insuring only certain drivers, and that omnibus coverage follows the vehicle. Thom v. 1st Auto & Casualty Insurance Co., 2021 WI App 33
, 398 Wis. 2d 273
, 961 N.W.2d 79
A vehicle is “described in a policy" if it is listed on the insurance application or on the policy's declarations page or if it is otherwise “covered" under the policy. In this case, it was undisputed that a vehicle owned by a third party and involved in the accident was not listed in the insureds' insurance application or the declarations page of the insurance policy, and the vehicle did not fit within the policy's definition of “your covered auto." The policy language provided that the insurer would insure the insureds' “use of any auto," which meant that the insurer would pay liability incurred the insureds, no matter what vehicles they drove. In other words, the insurer could not deny coverage to an insured individual on the ground that the insured individual was driving a vehicle that was not “your covered auto." No reasonable insured would read this definition to mean that the third party's vehicle the insured individual drove was itself “covered" under the policy. Thom v. 1st Auto & Casualty Insurance Co., 2021 WI App 33
, 398 Wis. 2d 273
, 961 N.W.2d 79
To determine whether an injury arose from the “use" of a vehicle, the court must ascertain whether the injury-causing activity is within the risk for which the parties reasonably contemplated coverage by asking whether the activity is reasonably consistent with the inherent nature of the vehicle. In this case, when the defendant sexually assaulted the insured inside the cab of the defendant's pickup truck and on the truck's tailgate, the defendant was not using the truck as a vehicle. The sexual assault was not related to the truck's inherent use as a means of transportation, and it was not a reasonable and natural consequence of that inherent use. The fact that the injurious conduct occurred inside the vehicle was not sufficient to transform that conduct into a “use" of the vehicle for purposes of insurance coverage. 1st Auto & Casualty Insurance Co. v. R.P., 2021 WI App 66
, 399 Wis. 2d 335
, 965 N.W.2d 460
An insurance company is only permitted to reduce its coverage limits under sub. (5) (i) 2. and its underinsured motorist's insurance policy by the total amount of worker's compensation actually received by the insured's estate. In this case, the estate was obligated by s. 102.29 (1) (b) to refund the worker's compensation insurer a portion of the settlement amount with the tortfeasor; under the statute, the estate was not paid the amount the estate paid back. Secura Supreme Insurance Co. v. Estate of Huck, 2021 WI App 69
, 399 Wis. 2d 542
, 966 N.W.2d 124
Sub. (2) (d) does not bar an insurer from requiring that an insured sustain bodily injury or death in order to trigger underinsured motorist (UIM) coverage under an automobile liability insurance policy. UIM insurance protects the insured accident victim, conditioning coverage on a nexus between the insured and the bodily injury or death suffered. Nothing in sub. (2) (d) precludes insurers from affording coverage to only those insureds who are injured in an auto accident. Brey v. State Farm Mutual Automobile Insurance Co., 2022 WI 7
, 400 Wis. 2d 417
, 970 N.W.2d 1
You Get What You Pay For: Why Wisconsin Should Adopt Uninsured and Underinsured Motorist Stacking Waivers. Kempke. 2016 WLR 411.
Uninsured motorists coverage: Wisconsin courts open up additional avenues of recovery. Dunphy. WBB Nov. 1982.
Politics & Wisconsin Automobile Insurance Law. Jaskulski. Wis. Law. Nov. 2010.
Wisconsin's New Automobile Insurance Law. End. Wis. Law. Oct. 2011.
Defense of noncooperation.
If a policy of automobile liability insurance provides a defense to the insurer for lack of cooperation on the part of the insured, the defense is not effective against a 3rd person making a claim against the insurer unless there was collusion between the 3rd person and the insured or unless the claimant was a passenger in or on the insured vehicle. If the defense is not effective against the claimant, after payment the insurer is subrogated to the injured person's claim against the insured to the extent of the payment and is entitled to reimbursement by the insured.
History: 1975 c. 375
; 1979 c. 102
Legislative Council Note, 1979: This provision is continued from former s. 632.34 (8). It is changed from a required provision of the policy to a rule of law. It is not the kind of rule that needs to be put in the policy to inform the policyholder. Indeed, the policyholder should receive no encouragement to fail to cooperate. This is a relaxation of present law. [Bill 146-S]
Prejudice is not a component of the defense of noncooperation. Schaefer v. Northern Assurance Co. 182 Wis. 2d 148
, 513 N.W.2d 16
(Ct. App. 1994).
, the Wisconsin Court of Appeals confirmed that this section had abrogated the common-law requirement of prejudice in non-cooperation cases, but this was true only for cases involving automobiles, to which this section expressly applies. Welton Enterprises, Inc. v. Cincinnati Ins. Co. 131 F. Supp. 3d 827
Prohibited rejection, cancellation and nonrenewal.
No insurer may cancel or refuse to issue or renew an automobile insurance policy wholly or partially because of one or more of the following characteristics of any person: age, sex, residence, race, color, creed, religion, national origin, ancestry, marital status or occupation.
History: 1975 c. 375
; 1979 c. 102
Accident in the course of business or employment. 632.36(1)(1)
Rate and other terms.
An insurer may increase or charge a higher rate for a motor vehicle liability insurance policy issued or renewed on or after April 16, 1982, on the basis of an accident which occurs while the insured is operating a motor vehicle in the course of the insured's business or employment, only if the policy covers the insured for liability arising in the course of the insured's business or employment. An insurer may issue or renew a motor vehicle liability insurance policy on or after November 1, 1989, on terms that are less favorable to the insured than would otherwise be offered, including but not limited to the rate, because of an accident which occurs while the insured is operating a motor vehicle in the course of the insured's business or employment, only if the policy covers the insured for liability arising in the course of the insured's business or employment.
(2) Cancellation or nonrenewal.
An insurer may cancel a motor vehicle liability insurance policy that is issued or renewed on or after November 1, 1989, or refuse to renew a motor vehicle liability insurance policy on or after November 1, 1989, on the basis of an accident which occurs while the insured is operating a motor vehicle in the course of the insured's business or employment, only if the policy covers the insured for liability arising in the course of the insured's business or employment.
History: 1981 c. 178
; 1989 a. 31
Use of emission inspection data in setting rates.
An insurer may not use odometer reading data collected in the course of an inspection under s. 110.20 (6)
as a factor in setting rates or premiums for a motor vehicle liability insurance policy or as a factor in altering rates or premiums during the term, or at renewal, of such a policy. However, an insurer may use such data as a basis for investigation into the number of miles that the motor vehicle is normally driven.
History: 1991 a. 279
; 1993 a. 213
Motor vehicle glass repair practices; restriction on specifying vendor.
An insurer that issues a motor vehicle insurance policy covering the repair or replacement of motor vehicle glass may not require, as a condition of that coverage, that an insured, or a 3rd party, making a claim under the policy for the repair or replacement of motor vehicle glass obtain services or parts from a particular vendor, or in a particular location, specified by the insurer.
History: 1991 a. 269
Motor vehicle repair practices; restriction on specifying vendor. 632.375(1)(1)
This section applies to every insurer that issues or delivers in this state a motor vehicle insurance policy that covers repairs to a motor vehicle registered or principally garaged in this state.
No insurer may require that, as a condition of the coverage specified in sub. (1)
, repairs to a motor vehicle must be made by a particular contractor or repair facility. For purposes of this section, a consumer has the right to select the motor vehicle repair facility of his or her choice.
No insurer may fail to initiate and conclude with due dispatch an investigation of a claim for repairs to a motor vehicle on the basis of whether the repairs will be made by a particular contractor or repair facility.
(3) Inapplicability to glass repair.
, rather than this section, applies to the repair or replacement of motor vehicle glass under a motor vehicle insurance policy.
History: 2015 a. 93
Nonoriginal manufacturer replacement parts. 632.38(1)(a)
“Insured" means the person who owns the motor vehicle that is subject to repair or the person seeking the repair on behalf of the owner.
“Insurer's representative" means a person, excluding the person repairing the motor vehicle, who has agreed in writing to represent an insurer with respect to a claim.
“Motor vehicle" means any motor-driven vehicle required to be registered under ch. 341
or exempt from registration under s. 341.05 (2)
, including a demonstrator or executive vehicle not titled or titled by a manufacturer or a motor vehicle dealer. “Motor vehicle" does not mean a moped, semitrailer or trailer designed for use in combination with a truck or truck tractor.
“Nonoriginal manufacturer replacement part" means a replacement part that is not made by or for the manufacturer of an insured's motor vehicle.
“Replacement part" means a replacement for any of the nonmechanical sheet metal or plastic parts that generally constitute the exterior of a motor vehicle, including inner and outer panels.
(2) Notice of intended use.
An insurer or the insurer's representative may not require directly or indirectly the use of a nonoriginal manufacturer replacement part in the repair of an insured's motor vehicle, unless the insurer or the insurer's representative provides to the insured the notice described in this subsection in the manner required in sub. (3)
. The notice shall be in writing and shall include all of the following information:
A clear identification of each nonoriginal manufacturer replacement part that is intended for use in the repair of the insured's motor vehicle.
The following statement in not smaller than 10-point type: “This estimate has been prepared based on the use of one or more replacement parts supplied by a source other than the manufacturer of your motor vehicle. Warranties applicable to these replacement parts are provided by the manufacturer or distributor of the replacement parts rather than by the manufacturer of your motor vehicle."
The notice described in sub. (2)
shall appear on or be attached to the estimate of the cost of repairing the insured's motor vehicle if the estimate is based on the use of one or more nonoriginal manufacturer replacement parts and is prepared by the insurer or the insurer's representative. The insurer or the insurer's representative shall deliver the estimate and notice to the insured before the motor vehicle is repaired.
If the insurer or the insurer's representative directs the insured to obtain one or more estimates of the cost of repairing the insured's motor vehicle and the estimate approved by the insurer or the insurer's representative clearly identifies one or more nonoriginal manufacturer replacement parts to be used in the repair, the insurer or the insurer's representative shall assure delivery of the notice described in sub. (2)
to the insured before the motor vehicle is repaired.
The insurer or the insurer's representative may not require the person repairing the motor vehicle to give the notice described in sub. (2)
Notwithstanding par. (b)
, if an insured authorizes repairs to begin prior to the approval by the insurer or the insurer's representative of an estimate that clearly identifies one or more nonoriginal manufacturer replacement parts to be used in the repair, the insurer or the insurer's representative shall send the written notice described in sub. (2)
by mail to the insured's last-known address no later than 3 working days after the insurer or the insurer's representative receives the estimate.
(4) Notice by telephone.
Notwithstanding sub. (3)
, notice of the intention to use nonoriginal manufacturer replacement parts in the repair of the insured's motor vehicle may be given by the insurer or the insurer's representative by telephone. If such notice is given, the insurer or insurer's representative shall send the written notice described in sub. (2)
by mail to the insured's last-known address no later than 3 working days after the telephone contact.
History: 1991 a. 176
LIFE INSURANCE AND ANNUITIES
Subch. V of ch. 632 Cross-reference
See also ch. Ins 2
, Wis. adm. code.
Prohibited provisions in life insurance. 632.41(1)(1)
No insurer may issue assessable life insurance policies under which assessments or calls may be made upon policyholders or others.
(2) Burial insurance.
Except as provided in s. 632.415
, no contract in which the insurer agrees to provide benefits to pay for any of the incidents of burial or other disposition of the body of a deceased may provide that the benefits are payable to a funeral director or any other person doing business related to burials.
See also ch. Ins 23
, Wis. adm. code.
Sub. (2) does not prohibit naming funeral director as beneficiary of life insurance policy in conjunction with separate agreement between insured and funeral director that proceeds will be used for funeral and burial expenses. 71 Atty. Gen. 7
Purpose of (2) is to prevent monopolistic or unfair trade practices. 76 Atty. Gen. 291
In this section, “multipremium funeral policy" means a life insurance policy sold under sub. (2)
for which premiums to fund the policy are paid over time.
A life insurance policy may provide for the assignment of the proceeds of the policy to a funeral director or operator of a funeral establishment if the insurance intermediary who sells or solicits the sale of the policy is not an agent of the funeral director or operator of the funeral establishment or if the assignment of proceeds is contingent on the provision of funeral merchandise or funeral services as provided for in a burial agreement that satisfies the requirements of s. 445.125 (3m)
and rules promulgated by the funeral directors examining board under s. 445.125 (3m) (j) 1. b.
A life insurance policy sold under sub. (2)
shall permit the policyholder to designate a different beneficiary, upon written notice to the insurer, and a different funeral director or operator of a funeral establishment that is to receive the assignment of proceeds, after written notice to the current funeral director or operator of the funeral establishment.
An insurer may issue a multipremium funeral policy only if, at the time that the policy is issued, the face amount of the policy is not less than the value of funeral merchandise and services to be provided under a burial agreement under s. 445.125 (3m)
The death benefit under a multipremium funeral policy may not be less than the face amount of the policy unless all of the following apply:
The policy contains a detailed explanation of the lower death benefit, as well as full disclosure of the lower death benefit on the first page of the policy.
The applicant does not apply for, or qualify for, any full face amount multipremium funeral policy that the insurer offers.
The death benefit is not less than at least one of the following:
Twenty-five percent of the face amount of the policy during the first year that the policy is in effect, 50 percent of the face amount of the policy during the 2nd year that the policy is in effect and the full face amount of the policy after the end of the 2nd year that the policy is in effect, but in no event less than the total of the premiums actually paid.
During the first 2 years that the policy is in effect, an amount equal to the actual premiums paid plus simple interest at the rate of 3 percent per year, and, after the end of the 2nd year that the policy is in effect, the full face amount of the policy.
The period over which premiums may be payable under a multipremium funeral policy may not exceed the following applicable period:
Twenty years, if the insured is less 60 years of age when the policy is issued.
Ten years, if the insured is at least 60 years of age but less than 80 years of age when the policy is issued.
Five years, if the insured is at least 80 years of age when the policy is issued.
At the time that an applicant applies for coverage under a multipremium funeral policy, the insurance intermediary or other person selling or soliciting the sale of the policy shall disclose the maximum number of premium payments to be made over the life of the policy, the frequency of the premium payments and the amount of each premium payment.
Proof of death for an insurance policy sold under sub. (2)
may be established with an affidavit in the form prescribed under s. 69.02 (1) (c)
if the insurer consents to receipt of the affidavit.
Subject to subs. (3)
, the commissioner shall by rule establish minimum standards for claims payments, marketing practices and reporting practices for life insurance policies sold under sub. (2)
History: 1999 a. 191
; 2003 a. 167
See also ch. Ins 23
, Wis. adm. code.
Trustee and deposit agreements in life insurance. 632.42(1)(1)
Trustee and other agreements.
An insurer may hold as a part of its general assets the proceeds of any policy subject to this subchapter under a trust or other agreement upon such terms and restrictions as to revocation by the policyholder and control by the beneficiary and with such exemptions from the claims of creditors of the beneficiary as the insurer and the policyholder agree to in writing. An insurer may also receive funds in such amounts and upon such conditions, including the right of the policyholder to withdraw unused portions thereof, as the insurer and the policyholder agree to in writing:
As premiums in advance upon policies or annuities subject to this subchapter; or
To accumulate for the purchase of future policies or annuities subject to this subchapter.
(2) Accumulation of funds.
Any insurer may, in connection with life insurance or annuity contracts, accept funds remitted to it under an agreement for an accumulation of the funds for the purpose of providing annuities or other benefits, under such reasonable rules as are prescribed by the commissioner.
History: 1975 c. 373